Personal injury claims are one of the most common cases that are litigated. Millions of people are injured each year in car accidents, slip and falls, by defective products and drugs, and by medical malpractice. Most of these claims are settled without a lawsuit being filed or after litigation has begun but prior to trial. Still, a significant number do end up before a jury. But claimants and litigants can also resolve their claims by using alternative dispute resolution methods such as arbitration.
What is Arbitration?
Arbitration is a process whereby the parties agree to use a neutral third party to hear the issues and evaluate the evidence before rendering a verdict that is binding on the parties. Many states require that personal injury litigants engage in non-binding arbitration if the case is filed with the verdict binding within 30-days after the verdict is issued unless one of the parties does not agree with the verdict and objects in writing.
In some cases, arbitration is mandatory and the only avenue to resolve a dispute. You can find arbitration clauses in medical or hospital malpractice cases in many instances where the patient agrees to medical care but only if he or she agrees to resolve any claims of malpractice through binding arbitration. In some instances, the patient may be advised that binding arbitration will be the sole method of dispute resolution unless the patient opts out in writing within a certain time. Most arbitration clauses will specify the venue where the arbitration is to be held, the number of arbitrators, the governing body, and the set of rules to be followed.
Binding arbitration is often mandatory for uninsured (UM) and underinsured (UIM) motorist case by contract. These arise in cases where the responsible motorist either lacks any liability coverage or has low liability limits that fail to compensate you fully for your damages. In these matters, your own auto liability carrier is your adversary and is obligated to provide coverage to you. In a UM case, the issues for the arbitrator may be whether the injured party was within the class of persons covered by the policy as well as the amount of damages that you can prove. If a UIM case, the issues is whether the claimant has damages that exceed the amount provided under the responsible party’s policy and to what extent.
If you arbitrate the case before a body such as the American Arbitration Association (AAA), which many arbitration clauses specify, you will have to choose an arbitrator used by that body and follow the procedural rules that it sets forth. It can also establish pre-hearing rules and procedures.
Advantages of Arbitration
There are several advantages to using arbitration instead of litigating the injury claim through the court:
- Cost is usually less
Arbitration is generally much less costly than the usual court case. Costs in a typical litigation matter include:
- Expert witness testimony that includes preparation, travel, and time waiting at the hotel or courthouse to testify as well as actual courtroom testimony–most experts charge a minimum fee
- Court reporter fees
- Service of process
- Court filing fee
- Fees for filing motions
- Subpoena fees for witnesses
In most cases, the attorneys for the parties will want to conduct the usual discovery that is undertaken if the claim is litigated, unless the arbitrator decides to limit it. This includes:
- Request for documents
- Request for admissions
- Having an “independent” or adverse medical examination of the injured party
- Subpoenaing or requesting records from doctors, hospitals, police, employers, and schools
- Depositions of the parties, doctors, and experts
In arbitrated cases with the usual discovery, the expenses you save are those imposed by the court. However, you can still save thousands of dollars by not having experts testify in-person at the arbitration unless you feel it is essential to prove your case.
- Shorter time to hearing
A typical case can take more than one year from filing to trial and usually takes longer. Some courts face significant backlogs with a shortage of judges and available courtrooms. In complex cases, it can take years to get to trial. With arbitration, the parties and arbitrator decide when they want to have the case heard. And when the case is heard, the parties need not worry about jurors being replaced or a judge having to deal with other matters that can delay the case.
- Parties can decide on manner of evidence and presentation
The parties can decide on the rules of evidence and the foundation for its introduction. For instance, expert testimony might be introduced through deposition transcripts only. Police reports, employment records, medical reports and records, forensic economist, and vocational expert reports can also be submitted without the need for live witness testimony. You can also limit the time for each side to present their case and defense with rebuttals.
You can also agree that the medical or other records be submitted with only an affidavit attached attesting to their authenticity or accuracy. In some personal injury cases, you and the insurer or other party can agree to submit the case on paper only with a set of agreed facts with deposition transcripts and other records provided for the arbitrator to review and base his or her verdict on.
If there is live testimony, it can proceed much faster than in a courtroom. The arbitrator can sustain or overrule objections to testimony but usually will consider some evidence without the fear of being unduly influenced by inflammatory or other comments or photos that might be considered prejudicial before a jury. Also, the formal rules of evidence may be loosened, unless you agree otherwise, and the arbitrator will usually state that he or she will weigh the evidence based on the credibility of the witness or whatever source derived.
- What issues are to be decided
If the parties only wish for liability to be decided, then only that issue will be submitted. If damages are the only issue, the parties can have the arbitrator decide that issue alone.
- You can limit the award
For example, you and the other party, usually the insurer for the defendant, can have a hi-lo agreement. For example, the lowest amount you are guaranteed may be $15,000 and the highest may be $100,000, since liability and the amount of certain damages may be at issue. Any award over $100,000 is reduced to this amount and any award under $15,000 is increased to $15,000. The arbitrator is unaware of the agreement and issues his or her award accordingly.
- After the Arbitration
An arbitrator acts as the judge and jury and may ask the witnesses, parties or their respective attorneys certain questions during or after the hearing is completed. Once the hearing is completed, the arbitrator will usually issue the verdict within a certain agreed time, which is usually 10 to 30-days. If the case was filed, then the arbitration award is submitted to the court and a final judgment is entered.
With binding arbitration, there are no appeals to the verdict. In more formal arbitrations such as with a body like the American Arbitration Association, appeals are possible but are limited to these issues:
- Corruption, fraud or misconduct
- The arbitrator exceeded his or her powers
- The arbitrator manifestly disregarded the law
Appeals must have a court record so a transcript of the proceedings is necessary. This entails paying for a court reporter to record the entire proceedings if you want to preserve an appeal. You may only want to do this in in cases where a substantial award is possible such as medical malpractice, catastrophic injury, or wrongful death cases. The party appealing an arbitration award, though, has a very high burden of proving that the arbitrator was corrupt or unduly biased or that he or she manifestly ignored the law. Overruling arbitration awards is rare.
Retain the Law Offices of West, Longenbaugh & Zickerman
A serious injury claim requires serious representation. If you want the best opportunity to obtain the most compensation available, then contact the personal injury lawyers at West, Longenbaugh & Zickerman. We handle all types of injury claims and have the litigation and arbitration experience necessary for the proper handling of your claim. We don’t get paid unless you do. Call us today at (520) 790-7337.